Fla. tax base down less than expected

TALLAHASSEE, Fla. – July 28, 2009 – Taxable property values dropped 15 percent last year, say county appraisers, which is less than the 17 percent expected. The loss represents about $360 billion, or more than the value of Miami-Dade County.

At the peak of the real estate market in 2007, taxable property values hit $2.4 trillion; last year, total revenue dropped to $2.1 trillion. However, state rules mandate that county tax appraisers ignore local real estate sales by lenders, which effectively bars foreclosures from consideration.

Bill Furst, Sarasota County’s property appraiser, says that his county’s 15 percent property value decrease probably underestimates the true change. He points to county condominium sales, saying that the average condo sale was $152,000 in 2008, or 40 percent below the average in 2007. But when he ignores foreclosures, the drop appears less severe – only 20 percent year-to-year.

“The question is: What did the market drop?” Furst asks. “Did it drop 40 percent or 20 percent?” In better market times, foreclosures were considered an anomaly that unfairly tainted local property values. With so many foreclosures today, that rationale has been questioned but not changed.

Sarasota’s Herald-Tribune analyzed appraisal reports from 58 of Florida’s 67 counties. According to the newspaper, Lee County took the biggest property value hit, dropping 26 percent. Saint Lucie County came in second at 24 percent.

However, a single year’s numbers don’t accurately reflect total property decreases. Areas of Florida that saw the earliest drops in value may have seen less in 2008 if their market was also one of the first to show signs of a turnaround. While Sarasota County came in at No. 20 in 2008, it ranks No. 4 when comparing declines over a two-year period.

On a positive note in 2009, housing sales have increased, leading some experts to think the worst is over.

“Seeing those sales go up, I likened it to kind of removing the bodies from a battlefield,” says Sean Snaith, director of the University of Central Florida Institute for Economic Competitiveness. But “it’s definitely not over. Until we can get credit markets fully functioning, it’s still difficult to get a mortgage.”

Source: Herald-Tribune, June 28, 2009; Doug Sword

© 2009 FLORIDA ASSOCIATION OF REALTORS®

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